The trend: Shopify is doubling down on merchant services as it seeks to offset slowing ecommerce sales.
Everything but the kitchen sink: In just the last few weeks, Shopify announced:
That’s in addition to the over 100 tools the company added in late June once it became apparent ecommerce growth was slowing.
Financial assistance: As conditions get more difficult for ecommerce merchants, Shopify is ramping up its revenue-based financing program to keep sellers solvent and make it easier for first-time sellers to get started on the platform.
A cause for concern: Shopify’s appeal is predicated on its ability to offer sellers the tools they need to build a successful ecommerce business. But an investigation by The Globe and Mail found that just 34% of Shopify stores survive for longer than a year. The average store in 2021 lasted just 143 days, down considerably from 220 days in 2019.
Shopify disputes these figures, but they are illustrative of its biggest problem—while the company depends on a steady influx of small businesses to drive GMV growth, many of these sellers lack the resources to upgrade to premium features (which make up the backbone of Shopify’s revenues) and are unable to survive long enough to make a lasting contribution to sales volumes.
Signs for optimism: Still, despite its struggles, the sheer quantity of tools available to sellers will enable Shopify to appeal to a broad variety of sellers, both small and enterprise, which will help shore up its business as inflation slows consumer spending.
Go further: For more on Shopify's growth prospects, read our Spotlight report.
This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.
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